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In the context of mortgages, a lender’s estimate of the monthly payments you would have to make under a particular loan arrangement, together with the costs to set it up.

Impaired Credit

Impaired credit mortgages are specialist loans for customers whose credit problems disqualify them from using mainstream lenders’ standard products. Some lenders specialise in loans like these, which are also known as adverse credit loans.

Income

An income strategy for investments is one which seeks to achieve a minimum level of income from the investment to fund day-to-day spending (often used by retired people).

Independent Mortgage Advice

Independence in regard to mortgage advisers is defined by the FSA as advice given in respect of the whole of the market, and offers the client a fee-only option, in other words is able to accept no other payments apart from those levied on the client, thereby eliminating any conflict of interest that could arise.

Interest

The premium which a borrower must pay a lender in return for use of the lender’s money.

Interest-Only Mortgage

An interest-only mortgage or interest only remortgage is where you simply pay the lender the minimum amount to cover the interest on your loan and invest enough each month in an investment vehicle to build up a large enough fund to pay off the capital part of the mortgage, when it becomes due at the end of the agreed term.

ISA Mortgage

A mortgage loan funded by contributions to an Individual Savings Account. ISAs provide tax-free growth, generated mainly by stockmarket investment. The ISA aims to repay the loan’s capital at the end of its term, but the interest element must be paid separately as you go along. It’s important to remember that past performance is not necessarily a guide to future performance.